London Daily

Focus on the big picture.
Wednesday, Aug 26, 2026

UK economy flatlines with no growth in February as strikes hit productivity

UK economy flatlines with no growth in February as strikes hit productivity

The lack of growth was unexpected - 0.1% had been forecast.

The UK economy flatlined in February, with no growth in GDP, according to official figures.

Civil service strikes and low energy consumption offset growth in areas such as construction - which grew 2.4%, the Office for National Statistics (ONS) data showed.

The flatlining was unexpected. Economists polled by the Reuters news agency had forecast slight growth of 0.1% for the month.

ONS figures showed services production fell by 0.1% in the month, following growth of 0.7% in January 2023.

The largest contributor to negative growth in the services industry was education, which fell 1.7% in a month where teacher strikes took place.

Another strikes hit sector, public administration, was the second largest contributor to negative growth in the services industry.

Construction grew thanks to repair works taking place and retail output increased as many shops had a "buoyant month", the ONS's director of economic statistics, Darren Morgan said.

Unseasonably mild and dry weather led to reduced production of electricity and gas, Mr Morgan added. Output in the arts, entertainment and recreation industries grew, however.

It followed growth of 0.4% in January and confirmation the UK economy avoided recession in the second half of 2022 and actually grew 0.1% in the final three months of the year.


The most recent projections from the independent economic forecaster, the Office for Budget Responsibility (OBR), said the UK will avoid recession - defined as two consecutive quarters of negative growth - in 2023, despite previous predictions.

But the economy will still shrink overall this year by an expected 0.2%, and the fiscal watchdog warned living standards are to fall by the largest amount since records began.

On a quarterly basis, the economy grew slightly. In the three months to February, the ONS said GDP, a measure of economic growth, increased by 0.1%.

However, responding to the flatlining, Chancellor Jeremy Hunt remained upbeat about the figures.

He said: "The economic outlook is looking brighter than expected - GDP grew in the three months to February and we are set to avoid recession thanks to the steps we have taken through a massive package of cost of living support for families and radical reforms to boost the jobs market and business investment."

But Labour's shadow chancellor Rachel Reeves criticised the government's record on economic growth.

She said: "Despite our enormous promise and potential as a country, Britain is still lagging behind on the global stage with growth on the floor.

"The reality of growth inching along is families worse off, high streets in decline and a weaker economy that leaves us vulnerable to shocks.

"These results are exactly why Labour's mission to secure the highest sustained growth in the G7 is so important - it's that level of ambition that we need to strengthen our economy, get our high streets thriving again and make families across every part of Britain better off."

The Bank of England's chief economist said the flatlining economy was "somewhat disappointing" but was still a significant improvement from its previous forecast of a recession.

Huw Pill, speaking at a panel event with Market News International Connect, said: "Last summer we were forecasting a pretty deep, and certainly a very prolonged, recession in the UK.

"Relative to that, the flatlining of the economy that we are seeing, in terms of the evolution of GDP, is a quite significant improvement."

Newsletter

Related Articles

0:00
0:00
Close
Church of England Faces Renewed Scrutiny Over Historical Safeguarding Failures
Reform UK Proposes £30 Tax Credit for Long HMRC Telephone Queues
Greater Manchester Secures More Than £100 Million to Upgrade Victorian Railway Stations
East Midlands Railway Urges Essential Travel Ahead of Bank Holiday Strikes
UK Economy Grows 0.4 Percent in Second Quarter as Global and Energy Pressures Weigh
UK Government and Sainsbury’s Launch Plan for 10,000 Youth Work Experience Placements
Scottish Government Plans Tighter Remote-Working Rules and Possible Voluntary Redundancies
Scottish Budget Faces More Than £700 Million Reduction After Tax Revenue Adjustment
Nearly 100 Labour MPs Press Andy Burnham to Back Electoral Reform Commission
UK Energy Price Cap Rises Four Percent to £1,723 as Middle East Conflict Drives Wholesale Gas Costs
Turnbull Warns AUKUS Could Leave Australia Without Promised Nuclear Submarines
California Billionaires Pour More Than $150 Million Into Fight Over Proposed Wealth Tax
German Broadcaster Goes Dark to Warn AfD Could End Its Saxony-Anhalt Service
Badenoch Plans Major Shadow Cabinet Reshuffle as Tories Struggle in Third Place
UK Government Demands Action Against Social Media Content Promoting Dangerous Driving
Labour Backbenchers Prepare Push for Electoral Reform Under Andy Burnham
Fire at Gatwick Airport Car Park Destroys 140 Vehicles and Cuts Local Power
UK Plans Voluntary Libido-Suppressing Medication Programme Across 20 Prisons
NHS England Launches Free Home Cervical Cancer Testing Kits Nationwide
Imperial College Study Warns North Sea Oil Projects Could Cause Hundreds of Billions of Pounds in Climate Damage
UK Inflation Rises to 2.9% as Middle East Conflict Pushes Up Energy Costs
Prime Minister Andy Burnham Visits Kyiv to Strengthen UK Support for Ukraine
Premier League Season Opens With Managerial Debuts and Dramatic Early Fixtures
England Cricket Drops Brydon Carse From Selection Pending Club Investigation
Graeme Dott Convicted of Child Sexual Abuse Offences in Scotland
Protesters Occupy British Aircraft Parts Factory Over Alleged Military Links to Israel
More Than 100 Former British and French Diplomats Call for Sanctions on Israel
Ipsos Poll Shows British Public Split Between Immigration Controls and Economic Growth
British Cybersecurity Agencies Raise Alert Over Growing Threats to Critical Infrastructure
Two-Thirds of England Now Under Official Drought Conditions After Prolonged Summer Heat
Institute of Directors Calls for Urgent Action to Revive Britain’s Stagnant Labour Market
Andy Burnham Visits Kyiv on First Foreign Trip and Pledges Continued British Support for Ukraine
New Daily Diabetes and Weight-Loss Pill Launches in UK Pharmacies
UK Payroll Employment Falls by 94,000 as Labour Market Cools
Onshore Wind Planning Applications in England Reach Ten-Year High After Rules Eased
UK Government Demands Social Media Platforms Remove Dangerous Driving Content After A66 Crash
Thames Water Creditors Face Backlash Over Proposed Corporate Restructuring
Twelve Arrested After Fatal A66 Crash Linked to Organised Crime Investigation
UK Household Energy Debt Could Reach £7 Billion by Year-End
UK Defence Ministry to Use Ukraine Battlefield Data to Train AI Security Systems
UK Government Redirects £4 Billion of Affordable Homes Funding Away From Social Housing
UK Government Borrowing Reaches £1.8 Billion in July, Exceeding Forecasts
UK Prime Minister Andy Burnham Pledges Advanced Missile Support for Ukraine
8Bank of England Holds Interest Rate at 3.75% as Middle East Energy Risks Rise
Prime Minister Andy Burnham to Give Ukraine Classified Storm Shadow Blueprints for Domestic Missile Production
UK Graduate Job Vacancies Plunge 45% to Lowest Levels on Record
Government Audit Reveals Pressure on UK Hospitality From Business Rates and Rising Costs
Kindertransport Survivor Prepares to Revisit European Sites Linked to Her Family’s Wartime Separation
Northern England Transport Operators Strengthen Contingency Plans as Travel Demand Rises
New Implant Trials Offer Treatment Prospects for Patients With Refractory Angina
×